If Three Investment Alternatives All Have Some Degree of Risk

question 88

Multiple Choice

If three investment alternatives all have some degree of risk and different expected returns, which of the following measures could best be used to rank the risk levels of the projects?

• A) Coefficient of correlation
• B) Coefficient of variation
• C) Standard deviation of returns
• D) Net present value

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Definitions:

Size

A dimension that represents the magnitude of an object or its extent in space in one or more directions.

Shape

The external form or appearance of an object or figure, determined by its outline or surface.

Color

A characteristic of visual perception that comes from the light they emit or reflect, defined by qualities such as hue, saturation, and brightness.

Gate Control Theory

A theory proposing that pain signals passing through the nervous system can be regulated or blocked by gates in the spinal cord, influencing the perception of pain.